Also known as: panels · panelation · jury panel
Written by attorneys · grounded in primary & secondary sources — see below
A group of one or more individuals appointed by a court to determine whether maintaining a derivative proceeding is in the best interests of the corporation.
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Pablo Perez files a derivative suit against Precision Tools alleging breach of fiduciary duty by its directors. The corporation moves for dismissal and requests appointment of a panel. The court appoints one individual to investigate and decide if the suit serves the company's best interests.
After the court-appointed panel concludes that continuing the derivative action against Precision Tools would not benefit the corporation, Pablo Perez must prove that the panel's determination failed to meet statutory requirements. The burden shifts because the panel was formed under the court-appointment provision.
Pablo Perez files a derivative suit against Precision Tools. The corporation moves for dismissal and the court appoints a panel that recommends dismissal. On appeal the reviewing court accepts the panel recommendation after confirming statutory procedures were followed.
Pablo Perez files a derivative suit against Precision Tools. After the court appoints a panel that finds the suit would not benefit the corporation, the reviewing court accepts the panel determination and dismisses the action.
Pablo Perez files a derivative suit against Precision Tools. The corporation obtains a court-appointed panel whose determination leads to dismissal. The panel's role under the statute is upheld on review.
Pablo Perez files a derivative suit against Precision Tools. The court appoints a panel that concludes continuation is not in the corporation's best interests, shifting the burden to Perez to show the panel failed statutory requirements.
The court appoints the panel upon motion by the corporation. The panel then evaluates whether the derivative proceeding is in the corporation's best interests.
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The plaintiff must prove that the requirements for dismissal have not been met. This allocation applies specifically because the panel was appointed by the court rather than by the board or a board committee.
Supporting sources
The court may dismiss the proceeding if the panel determines that maintaining it is not in the corporation's best interests, provided the panel followed proper procedures.
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…on its face and an injunction against its enforcement. The District Court held that the statute was unconstitutional. A panel of the Court of Appeals for the Ninth Circuit reversed, but the full Court of Appeals convened en banc and reversed the panel, holding the statute unconstitutional. We granted certiorari,…